Eviction looming at Kailuan co-op

Kaneohe Ranch, owner of the ground lease for the Kailuan cooperative, began legal proceedings yesterday to force the remaining unit owners in the leasehold residential complex to move.

An estimated half dozen or so out of 18 units at the Kailuan are still occupied, even though the ground lease for the property expired on Dec. 31, said Mitch D'Olier, CEO of Kaneohe Ranch.

He said the company began proceedings yesterday to avoid sanctions for violations previously cited by the U.S. Environmental Protection Agency.

He said he expects the Kailuan to be completely vacant sometime during the first two weeks of this month.

The majority of leasehold owners had wanted to buy the property fee from Kaneohe Ranch, but talks broke down Dec. 19. The lease terms required the remaining shareholders to vacate when the lease expired. The take-back of the property by Kaneohe Ranch will be the first modern-day surrender of a Hawaii leasehold condominium or co-op.

Remaining Kailuan shareholders are still there for a variety of reasons. Some have said that they still hold out hope that Kaneohe Ranch will reopen negotiations with them. Others have said that they haven't yet found alternative housing or that they need moving assistance. A few have said that they are considering their own legal actions.

Once Kaneohe Ranch has secured the property from former leaseholders, it will shut off the building's water and close its large-capacity cesspools, D'Olier said.

"Our immediate goal is to get the property back from the shareholders and begin addressing the EPA mandate," D'Olier said. "Plans for future sale or development of the property remain tentative."

To help ease the situation for former lessees, Kaneohe Ranch also has hired Realtors and charities to serve them, D'Olier said. The company paid $10,000 to four owners who took them up on an early exit option and assisted one former lessee with their first month's rent.